Transforming growth factors confer a malignant phenotype on non-neoplastic cells. At present, the function(s) of these factors is unknown. This project examines the possibility that transforming growth factors play a role during embryogenesis and takes advantage of the fact that embryonal carcinoma (EC) cells represent a good model system for the study of early mammalian development. The EC cell lines used were induced to differentiate into parietal and visceral endoderm, which are two of the first cell types to form during mammalian development. The differentiated cells from F9 and PC-13 EC cells, but not the parental cells themselves, were found to respond by increased growth to transforming growth factors released by virus transformed cells. Furthermore, F9 and PC-13 cells, which did not respond to exogenously added transforming growth factors, were shown to release their own factors with transforming growth factor activity. Based on the close relationship between mouse EC cells and the cells of early embryos, the possibility that transforming growth factors play a role during the early stages of mammalian development must be seriously entertained.